Shaktidham Charity Trust, Kolkata V. ITO, Exemption, Ward-1(3), Kolkata, Kolkata

ITA 368/KOL/2022

AI Insights

The case involves Shaktidham Charity Trust appealing against the order of the Commissioner of Income-tax (Appeals) which denied the recognition of a Rs. 11,00,000 donation as part of the Trust's corpus. The donation was intended for the Trust's corpus but was not explicitly mentioned as such in the donor's letter, leading to its initial rejection by the CIT(A). The Trust argued that the donation was indeed for the corpus and provided an affidavit from the donor affirming this intention. The Tribunal, after considering the affidavit, the Trust's accounting entries, and the audited financial statements, ruled in favor of the Trust.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 128749 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 15-01-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 21-06-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 80G; 12A; 143(1); 250

Judgement Text

आयकर अपीलीय अधिकरण कोलकाता 'एसएमसी' पीठ, कोलकाता म ें IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘SMC’ BENCH, KOLKATA श्री संजय गग ग , न्याधयक सदस्य एवं डॉ. मनीष बोरड, ल े खा सदस्य क े समक्ष Before SRI SANJAY GARG, JUDICIAL MEMBER & DR. MANISH BORAD, ACCOUNTANT MEMBER I.T.A. No.: 368/KOL/2022 Assessment Year: 2018-2019 Shaktidham Charity Trust......................................Appellant [PAN: AADTS 3065 J] Vs. ITO, Exemption, Ward-1(3), Kolkata......................Respondent Appearances by: Sh. Ashish Rustagi, A/R, appeared on behalf of the Assessee. Smt. Ranu Biswas, Addl. CIT D/R, appeared on behalf of the Revenue. Date of concluding the hearing : January 16 th , 2023 Date of pronouncing the order : February 06 th , 2023 ORDER Per Manish Borad, Accountant Member: This appeal filed by the assessee pertaining to the Assessment Year (in short “AY”) 2018-2019 is directed against the order passed u/s 250 of the Income Tax Act, 1961 (in short the “Act”) by ld. Commissioner of Income-tax (Appeals)-NFAC, Delhi [in I.T.A. No.: 368/ KOL/2022 Assessment Year: 2018-2019 Shaktidham Charity Trust. Page 2 of 5 short ld. “CIT(A)”] dated 19.05.2022 arising out of the assessment order framed u/s 143(1) of the Act dated 30.09.2019. 2. The assessee is in appeal before the Tribunal raising the following grounds: “1. That on the facts and in the circumstances of the case, the Assessment Order passed by the learned CIT is against law, facts and evidences on record. 2. That the learned CIT erred in considering that the donation received amounting to Rs. 11,00,000/- is not towards the corpus of the trust. 3. That the learned CIT erred in not allowing opportunity before treating donation received amounting to Rs. 11,00,000/- is not towards corpus of the trust. The Appellant craves leave to add, amend, alter, vary and / or withdraw any or all the above grounds on or before the date of hearing of the appeal.” 3. At the outset, ld. Counsel for the assessee submitted that the assessee received the donation of Rs. 11,00,000/- towards the corpus of the Trust but inadvertently the word “corpus” was not mentioned in the letter issued by the donors and for this very reason, the alleged addition has been made. Further, it is submitted that total amount received towards the “corpus of the Trust” as well as normal donations received during the year have been applied for the object of the Trust and the sum so received has been spent for the construction of Dharamshala/Satsang Bhawan. 4. On the other hand, ld. D/R vehemently argued supporting the order of ld. CIT(A). I.T.A. No.: 368/ KOL/2022 Assessment Year: 2018-2019 Shaktidham Charity Trust. Page 3 of 5 5. We have heard rival contentions and perused the records placed before us. Only grievance of the assessee is that ld. CIT(A) erred in not treating the donation of Rs. 11,00,000/- as a donation received towards corpus of the Trust. We notice that the assessee Trust is registered u/s 12A of the Act vide Registration No. DIT(E)/8E/T-94/2001-02 dated 11.12.2002 and also registered u/s 80G of the Act. For the year under appeal, NIL income declared in the return of income submitted on 25.07.2018 claiming exemption u/s 11(1)(d) of the Act at Rs. 34,77,000/-. Ld. CIT(A) while examining the details of the donation received towards the corpus of the Trust observed that in case of donation through account payee cheques received from Doon Valley Finance and Leasing Ltd. amounting to Rs. 11,00,000/-, in the letter issued by Doon Valley Finance and Leasing Ltd., it only mentioned that the donation is given towards the Trust and the word “corpus” was missing. Though the assessee has claimed that the said donation was received towards corpus of the Trust and the same has been duly entered in the books of account and Audit report as a donation received towards corpus of Trust but in the letter issued by the above said donor the word “towards the corpus” inadvertently remained to be included. Before us, the assessee has filed an affidavit given by Mr. Subhas Chandra Bhartia who is the authorized signatory of Doon Valley Finance & Leasing Ltd. placed in paper book and at para 3 it is stated “That our company M/s. Doon Valley Finance and Leasing Ltd. had always intended to give the said amount of Rs. 11,00,000/- towards the ‘Corpus’ of the Trust.” I.T.A. No.: 368/ KOL/2022 Assessment Year: 2018-2019 Shaktidham Charity Trust. Page 4 of 5 6. It is also observed that in the receipt issued by the assessee Trust the alleged donation has been shown to be received towards corpus of the Trust. Therefore, considering all the facts and circumstances of the case including the receipt issued as well as the affidavit given by the donor, accounting entries made by the assessee Trust, audited financial statement and also considering the fact that total sum received during the year through voluntary contribution towards the corpus of the Trust has been applied for the objects of the assessee Trust during the year itself, we reverse the finding of ld. CIT(A) and hold that the alleged sum of Rs. 11,00,000/- is to be treated as a voluntary contribution received towards the corpus of the Trust. Thus, all the effective ground nos. 2 & 3 raised by the assessee are allowed. 7. Other grounds are general in nature which need no adjudication. 8. In the result, the appeal filed by the assessee is allowed. Kolkata, the 06 th February, 2023 Sd/- Sd/- [Sanjay Garg] [Manish Borad] Judicial Member Accountant Member Dated: 06.02.2023 Bidhan (P.S.) I.T.A. No.: 368/ KOL/2022 Assessment Year: 2018-2019 Shaktidham Charity Trust. Page 5 of 5 Copy of the order forwarded to: 1. Shaktidham Charity Trust, 8Y, Jogodyan Lane, 1 st Floor, Kolkata-700 054. 2. ITO, Exemption, Ward-1(3), Kolkata. 3. CIT(A)-NFAC, Delhi. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata